Bridging the Wealth Gap Columbian Style

The British press has recently been full of reports concerning the increasing gap between rich and poor created by the economic downturn in the UK...

The British press has recently been full of reports concerning the increasing gap between rich and poor created by the economic downturn in the UK, something that is mirrored across the developed world. Times of recession have historically proven to be opportunistic times for the cash-rich, and most new millionaires are created in recessionary climates while the majority struggle to keep afloat.

It is interesting to take a look at those countries that have experienced rich-poor disparity for centuries and how they are now taking proactive steps to bring about change and narrow the gap that exists between the classes, particularly in farming.

British Farmers Produce 60% of the UK's Food Requirements

Colombia has one of the worst levels of poverty in Latin America with more than 34% of the population living below the poverty line, a statistic that has reduced significantly from 45% in 2005 and continues to fall year-on-year.

british farms

Britain's renowned 'green and pleasant lands', now a poverty trap for the majority of UK farmers

 Over the past few years, the economic recession has hit the UK's farmers harder than most other economic sectors leading to the Royal Agricultural Benevolent Institution (RABI) to raise serious concerns about the welfare of farming families in Britain, comparing the level of the current crisis to the foot-and-mouth outbreak of 2001. The report also shockingly revealed that many farming families are finding themselves living well below the poverty line in the UK.

Colombian Model Matches Investment with Social Need

Shifting focus back to Colombia where farming is the mainstay of the economy, a new investment vehicle has been created to provide land-owning farmers with the necessary capital injection to ensure they can continue to operate, whilst mitigating any associated risks.

colombians work the land

Investments in farmland are SIPP-recognised and provide crucial cash injection to workers in agriculture

As an equatorial country, Colombia has its fair share of rainforests although the indigenous peoples who traditionally lived and worked forest lands have been largely displaced over the last century as deforestation for industry altered the landscape they depend upon for income, culminating in the scale of poverty witnessed in the country in recent years.

Now, it would appear that the privileged classes are using the benefits of their expensive education combined with intense patriotism to 'give back' to the Colombian people by way of regenerating swathes of forest and farmland, providing all-important employment prospects to the indigenous people who know how to work the land better than anyone.

Colombian workforce

Guadua Bamboo's Colombian workforce set for financial security after years of poverty

Guadua Bamboo is one such company. Run by a principally Colombian team, Guadua own 116 hectares of prime agricultural land used to farm giant timber bamboo which has the potential to substitute almost all conventional wood-derived products.

The plantation is managed within 6 hectares on which there are offices, nurseries and workshops with the remaining 110 hectares being separated into legally titled small-holdings and offered to investors looking for the security of a tangible asset that provides an annual revenue stream together with capital growth in the land itself.

Investing in Titled Farmland Boosts GDP

The opportunity essentially allows investors to own and manage a plantation from their armchairs with an investment of as little as €15,000. With the investment income, Guadua is able to manage, harvest and sell the crops on each small-holding on behalf of the owner, employing a local workforce with a wealth of experience and providing an opportunity for many to escape the poverty trap.

It's a fairly simple principal which is set to provide a significant economic boost in areas of Colombia most affected by poverty and forest degradation.

transporting plants

Investment funds from the wealthy bridge the gap between classes

Timber has long been considered a high-performance market, out-performing most other asset classes over the last 100 years. Guadua bamboo is considered to be the strongest bamboo species in the world and is widely used in construction, furniture, laminated floors, panels, etc.

Harnessing Market Forces to Bring About Regeneration

With the global market for bamboo expected to reach $20bn by 2015, this investment vehicle represents a low risk opportunity with healthy annual returns and intrinsic capital growth. In addition, it is a socially responsible investment providing an unparalleled opportunity for Colombia's poor to work their way back to economic security – the long term gains of which are immeasurable.

Although agriculture in the UK contributes just 2% to GDP, farming produces 60% of the country's food requirements placing the sector as one of the UK's most important contributors. Agriculture employs around 2% of the nation's workforce and so it is a relatively small group of people, often neglected, behind the UK's food production.

According to UK Agriculture, total income from farming has fallen by 60% since 1996 with many complete regions and sectors of the industry generating zero or negative return. Overheads contribute to the financial burdens of many farmers and so a logical solution may perhaps be found by taking a leaf out of Guadua Bamboo's book.

- Friday 11 July 2014

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